Why do you need to focus more on NPD?
This can be answered by understanding the changes happening in external and internal to the organizations.
Changes in Internal to the organizations :
As a Business head, your prime concern is sustaining profitability and ensuring future growth.
Conventionally , sustaining profitability calls for efficiency improvement,cost optimization and so on. Beyond some point, process optimization does not yield much improvement unless you revisit and re-engineer your product portfolio.
Hence, you can sustain your business profitability by creating an environment for continuous New product development and position yourself as the first mover or the preferred source to your customer on new product developments and ramping up.
As you are aware that when you are manufacturing the same parts over a period of time, it will become a commodity and you lose the competitive advantage, in turn, you lose your profit margin. To compensate or sustain the profitability, smart organizations, equally focus more on New Product Development (NPD).
Also, the existing product portfolio dries out, the only way for growth is bringing out more new products.
Changes in External to the organization :
External to the organization, the consumers are changing fast. Thanks to awareness, affordability and enhanced lifestyle, consumers are looking for more varieties and prefer to change the product frequently to keep them update in the society.
For example in the case of mobile devices, laptop, automobile, there were fewer varieties and more volume when they were introduced to the world than now.
This change in external environment results in more new product development focus inside the organization.
Going forward, the organization which equally focus on both efficiency and new value creation will sustain the profitability and growth.
This can be answered by understanding the changes happening in external and internal to the organizations.
Changes in Internal to the organizations :
As a Business head, your prime concern is sustaining profitability and ensuring future growth.
Conventionally , sustaining profitability calls for efficiency improvement,cost optimization and so on. Beyond some point, process optimization does not yield much improvement unless you revisit and re-engineer your product portfolio.
Hence, you can sustain your business profitability by creating an environment for continuous New product development and position yourself as the first mover or the preferred source to your customer on new product developments and ramping up.
As you are aware that when you are manufacturing the same parts over a period of time, it will become a commodity and you lose the competitive advantage, in turn, you lose your profit margin. To compensate or sustain the profitability, smart organizations, equally focus more on New Product Development (NPD).
Also, the existing product portfolio dries out, the only way for growth is bringing out more new products.
Changes in External to the organization :
External to the organization, the consumers are changing fast. Thanks to awareness, affordability and enhanced lifestyle, consumers are looking for more varieties and prefer to change the product frequently to keep them update in the society.
For example in the case of mobile devices, laptop, automobile, there were fewer varieties and more volume when they were introduced to the world than now.
This change in external environment results in more new product development focus inside the organization.
Going forward, the organization which equally focus on both efficiency and new value creation will sustain the profitability and growth.
No comments:
Post a Comment